Are you thinking about shopping at a pawn shop in Boca Raton?
There are over 10,000 pawn establishments in the U.S. Pawn shops offer many American consumers an opportunity to sell and buy goods at reasonable rates.
While pawn shops are common, they do offer a different environment than consignment or thrift stores.
If you’re curious about how pawn shops work, keep reading.
In this post, we break down the ins and outs of a standard pawn shop so that you can know what to expect–as a buyer or a seller!
What is a Pawn Shop?
A pawn shop isn’t just a place where you can buy a variety of consumer goods at a low price–although this is often what they are known for.
A pawnbroker is actually someone who offers short-term, secured loans to individuals with proper collateral. People who “sell” items to a pawn shop are thus not necessarily selling them.
They offer them as collateral for a secured loan (i.e., “fast cash”). These secured loans are valued at the value of the collateral itself, whether that item is a gold necklace, television, or piece of furniture.
These individuals then have one of two options.
They can pay off the loan itself via the pawnbroker’s terms and collect their collateral once the loan is paid off. Or they can surrender the collateral as payment for the loan in full.
The items that are for sale in a pawn shop are, therefore, surrendered collateral.
A lot of people assume that pawn shops are associated with crime. However, pawn shops are governed by thirteen laws. These federal laws also govern other financial institutions.
These laws include the U.S. Patriot Act, the Truth-in-Lending Act, and Bank Secrecy Acts, among others.
Some pawn shops specialize in anything and everything. Others may offer loans on specific items, such as gold or electronics.
Anyone can walk into a pawn shop and purchase an item. You don’t have to be currently pawning something to do so!
What Do Pawn Shops Buy?
Keep in mind that pawn shops aren’t necessarily “buying” items from individuals. They are securing them as collateral for short-term, low-interest loans.
However, most pawn shops offer competitive rates on these secured loans. If you have a valuable possession that you don’t mind giving up in exchange for fast cash, a pawn shop is ideal for you.
Be sure to check in with a pawn shop before you bring valuable items into the store. Some may only be interested in items of a certain quality or type.
At National Pawn & Jewelry, for example, we specialize in buying estate jewelry, fine watches, and other luxury pieces you may have in possession.
You can easily figure out what your local pawn shop buys simply by giving them a call.
It’s also important to research pawn shops before you prepare to sell.
Make sure you are bringing your valuable item to a reputable shop. A great way to ensure a shop is reputable is to ask friends and family members for referrals or to check out online reviews.
Another method is to research a pawn shop’s policies on security and confidentiality. You can read our policies at National Pawn & Jewelry here.
You may also want to identify a minimum sale value before you head into a pawn shop. Keep in mind that a pawnbroker won’t necessarily offer you $500 for that platinum ring–the value may be lower in the long-run.
If you are wishing to pawn or sell jewelry, consider having that item appraised by a professional before pawning.
You can negotiate sales prices successfully with a pawnbroker if you do this research ahead of time.
Shopping at a Pawn Shop
Pawnbrokers aren’t just here to service people needing cash. You can drop by a pawn shop if you’re keen to buy something valuable at a relatively low cost.
In fact, shopping at a pawn shop can be a smart financial move. Much like shopping at a thrift or consignment store, pawn shopping can help you to invest in an item you need at a fraction of its original cost.
Before you head into a pawn shop, however, we recommend identifying what you’re looking for. This will give you a chance to assess the item’s value in its existing condition before you buy.
Some pawn shops have an online shop of their current collection. Browsing through an online shop before buying is a great way to do your research ahead of time.
Some people are wary that they’ll be purchasing “stolen goods” from a pawn shop. While some thieves do try to turn stolen items into cash by chasing down pawn shops, this is less common than you think.
Most pawn shops are also very strict when it comes to approving collateral.
Nonetheless, do your research wisely before you make a purchase. Be wary of any pawn shops that seem shady or are vague about where they sourced a specific item.
Most pawn shops do not offer returns on purchases. When you buy something from a pawn shop, it is likely a final deal.
Some, however, do offer returns or refunds of some kind. Be clear on these policies before you whip out your credit card.
Otherwise, make sure you are 100% confident in a purchase decision before you make it at a pawn shop.
You can do this by locating reputable pawn shops and researching items ahead of time.
How Pawn Shops Work
Pawn shops may feel like a staple of any American town. But a lot of people don’t know how pawn shops work.
Pawn shops are first and foremost brokers of secured personal loans. They offer collateral loans to the right individuals. Additionally, they may buy select pieces or goods from consumers.
The items for sale in a pawn shop are those surrendered as payment for short-term loans. In this sense, pawn shops are quite different from a standard thrift store.
Whether you are interested in buying or selling items at a pawn shop, it’s important to do your research ahead of time. Make sure you are working with a reputable, well-established pawn shop.
At National Pawn & Jewelry, you can feel confident that you are buying from one of Florida’s best pawn shops. Sign up for a shopper’s coupon here!